EU's upcoming online-content payment system draws fire

The European Commission will publish its proposals for a pan-European licensing system for digital music distribution this week, but has elected to issue recommendation, rather than law.

by
Simon Taylor
, | 10 Oct 05

The European Commission will publish its proposals for a pan-European licensing system for digital music distribution this week, but has elected to issue recommendation, rather than law.

Major online media companies have strongly criticized the plans. The Commission is planning to present its vision of how to make it easier for authors and content providers to get licenses across the European Union and avoid having to apply for licenses in 25 different jurisdictions.

Legal reforms demanded by some

A director of the digital media industry's trade association said that the Commission's move would not lead to the creation of a competitive system of collective rights management. "We have a problem with the lack of far-reaching reform of collective rights management," said Wes Himes, director of the European Digital Media Association (EDIMA). EDIMA's members include Amazon.com, Apple, MovieSystem, RealNetworks and Internet service providers like Wanadoo, Yahoo and Tiscali.

Himes singled out as a weakness the fact that the Commission has chosen to make a recommendation, which allows EU countries to decide how to set up their national systems, rather than adopting binding legislation. "We felt that there should be a competitive mechanism by which pan-European companies can obtain pan-European licenses for online exploitation. This doesn't achieve this. It only exerts a small pressure on member states [to do so]," Himes said.

Lobbying blocks legal progress

He said that plans being considered by the Commission earlier in the year had been "watered down", following lobbying by collective-rights management societies.

However, the Commission's strategy was given a cautious welcome by the group that represents authors and artists' rights. "We think a recommendation is better than a directive because technologies are evolving rapidly and you need a great deal of flexibility. With a directive there's a risk of getting stuck [with a particular model]," said Isabelle Prost, a legal advisor with GESAC, the European Grouping of Societies of Authors and Composers. She is waiting to see the final text from the Commission before commenting on the details of the recommendation, she said.

Archaic system panned

"Europe's model of copyright clearance belongs more to the 19th century than to the 21st," Jacqueline Minor, a director at the Commission's Internal Market department said Friday at a conference on copyright in London. "We need a new generation of copyright licensing model more in tune with the Internet age."

Commercial operators need to be able to secure licenses for more than one territory, she said. This would also help rights owners to have their content disseminated as widely as possible and give them more choice over which rights manager they used. Rights managers would have to allocate licenses on nondiscriminatory terms. The recommendation would also include provisions to deal with the fair distribution of royalties and effective dispute resolution.

However this claim was contested by EDIMA's Himes. "We asked for a proper third-party adjudication system but it's been diluted."